Knight Vinke, an activist investor in Xstrata, said on Friday it would push
for a shake-up of the miner's board if a proposed merger with commodities
trader Glencore collapses at a vote next week.

The investor, which owns 0.5pc of the miner, also confirmed it would vote against the all-share deal unless terms are "materially improved".

"If the board of Glencore is unwilling to pay for acquiring the control it seeks, we would support Xstrata's continuing independence as a fundamentally strong and successful business," it said in a brief statement.

"In addition, should the transaction fail to be approved, we intend to consult with other shareholders regarding the composition of the Xstrata board so as to make it more independent and robust."

The tie-up plans were announced in February with 2.8 Glencore shares on offer for each Xstrata one. However, Qatar Holding said in June that an exchange ratio of 3.25 “would provide a more appropriate distribution of benefits of the merger whilst properly recognising the intrinsic standalone value of Xstrata”.

Ivan Glasenberg, Glencore’s chief executive, said last week the deal would not be done if the terms were not right.

Norway’s state investment fund Norges Bank Investment Management, which holds almost 3pc of Xstrata, is also understood to have said it opposed the deal on the current terms.

Although Glencore owns more than a third of Xstrata, it cannot vote on the merger, which requires a 75pc majority of all those entitled to vote. This means just 16.5pc of Xstrata total shareholder base voting against a deal could scupper the merger.

Xstrata shares rose 16.6 - or 1.8pc - to 917.7p and Glencore shares gained 9.4 - or 2.6pc - to 366.7p in early trading on Friday. This meant Xstrata shares were trading on a ratio of around 2.5 times, a significant discount to the proposed deal ratio of 2.8.